EXHIBIT 3.2
WILSHIRE REAL ESTATE INVESTMENT TRUST INC.
BY-LAWS
ARTICLE I.
STOCKHOLDERS
SECTION 1.01. ANNUAL MEETING. The Corporation shall hold an annual
meeting of its stockholders to elect directors and transact any other business
within its powers, either at 10:00 a.m. on the second Monday of June in each
year if not a legal holiday, or at such other time on such other day falling on
or before the 30th day thereafter as shall be set by the Board of Directors.
Except as the Charter or statute provides otherwise, any business may be
considered at an annual meeting without the purpose of the meeting having been
specified in the notice. Failure to hold an annual meeting does not invalidate
the Corporation's existence or affect any otherwise valid corporate acts.
SECTION 1.02. SPECIAL MEETING. At any time in the interval between annual
meetings, a special meeting of the stockholders may be called by the Chairman of
the Board or the President or by a majority of the Board of Directors by vote at
a meeting or in writing (addressed to the Secretary of the Corporation) with or
without a meeting. Special meetings of the stockholders shall be called by the
Secretary at the request of stockholders only on the written request of
stockholders entitled to cast at least a majority of all the votes entitled to
be cast at the meeting. A request for a special meeting shall state the purpose
of the meeting and the matters proposed to be acted on at it. The Secretary
shall inform the stockholders who make the request of the reasonably estimated
costs of preparing and mailing a notice of the meeting and, on payment of these
costs to the Corporation, shall notify each stockholder entitled to notice of
the meeting. Unless requested by stockholders entitled to cast a majority of
all the votes entitled to be cast at the meeting, a special meeting need not be
called to consider any matter which is substantially the same as a matter voted
on at any special meeting of stockholders held in the preceding 12 months.
SECTION 1.03. PLACE OF MEETINGS. Meetings of stockholders shall be at
such place in the United States as is set from time to time by the Board of
Directors.
SECTION 1.04. NOTICE OF MEETINGS; WAIVER OF NOTICE. Not less than ten nor
more than 90 days before each stockholders' meeting, the Secretary shall give
written notice of the meeting to each stockholder entitled to vote at the
meeting and each other stockholder entitled to notice of the meeting. The
notice shall state the time and place of the meeting and, if the meeting is a
special meeting or notice of the purpose is required by statute, the purpose of
the meeting. Notice is given to a stockholder when it is personally delivered
to him or her, left at his or her residence or usual place of business, or
mailed to him or her at his or her address as it appears on the records of the
Corporation. Notwithstanding the
foregoing provisions, each person who is entitled to notice waives notice if he
or she before or after the meeting signs a waiver of the notice which is filed
with the records of stockholders' meetings, or is present at the meeting in
person or by proxy.
SECTION 1.05. QUORUM; VOTING. Unless any statute or the Charter provides
otherwise, at a meeting of stockholders the presence in person or by proxy of
stockholders entitled to cast a majority of all the vote entitled to be cast at
the meeting constitutes a quorum, and a majority of all the votes cast at a
meeting at which a quorum is present is sufficient to approve any matter which
properly comes before the meeting, except that a plurality of all the votes cast
at a meeting at which a quorum is present is sufficient to elect a director.
SECTION 1.06. ADJOURNMENTS. Whether or not a quorum is present, a meeting
of stockholders convened on the date for which it was called may be adjourned
from time to time without further notice by a majority vote of the stockholders
present in person or by proxy to a date not more than 120 days after the
original record date. Any business which might have been transacted at the
meeting as originally notified may be deferred and transacted at any such
adjourned meeting at which a quorum shall be present.
SECTION 1.07. GENERAL RIGHT TO VOTE; PROXIES. Unless the Charter provides
for a greater or lesser number of votes per share or limits or denies voting
rights, each outstanding share of stock, regardless of class, is entitled to one
vote on each matter submitted to a vote at a meeting of stockholders. In all
elections for directors, each share of stock may be voted for as many
individuals as there are directors to be elected and for whose election the
share is entitled to be voted. A stockholder may vote the stock the stockholder
owns of record either in person or by proxy. A stockholder may sign a writing
authorizing another person to act as proxy. Signing may be accomplished by the
stockholder or the stockholder's authorized agent signing the writing or causing
the stockholder's signature to be affixed to the writing by any reasonable
means, including facsimile signature. A stockholder may authorize another
person to act as proxy by transmitting, or authorizing the transmission of, a
facsimile, telegram, cablegram, datagram, or other means of electronic
transmission to the person authorized to act as proxy or to a proxy solicitation
firm, proxy support service organization, or other person authorized by the
person who will act as proxy to receive the transmission. Unless a proxy
provides otherwise, it is not valid more than 11 months after its date. A proxy
is revocable by a stockholder at any time without condition or qualification
unless the proxy states that it is irrevocable and the proxy is coupled with an
interest. A proxy may be made irrevocable for so long as it is coupled with an
interest. The interest with which a proxy may be coupled includes an interest
in the stock to be voted under the proxy or another general interest in the
Corporation or its assets or liabilities.
SECTION 1.08. LIST OF STOCKHOLDERS. At each meeting of stockholders, a
full, true and complete list of all stockholders entitled to vote at such
meeting, showing the number and class of shares held by each and certified by
the transfer agent for such class or by the Secretary, shall be furnished by the
Secretary.
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SECTION 1.09. CONDUCT OF BUSINESS AND VOTING. At all meetings of
stockholders, unless the voting is conducted by inspectors, the proxies and
ballots shall be received, and all questions touching the qualification of
voters and the validity of proxies, the acceptance or rejection of votes and
procedures for the conduct of business not otherwise specified by these By-Laws,
the Charter or law, shall be decided or determined by the chairman of the
meeting. If demanded by stockholders, present in person or by proxy, entitled to
cast 10% in number of votes entitled to be cast, or if ordered by the chairman,
the vote upon any election or questions shall be taken by ballot and, upon like
demand or order, the voting shall be conducted by two inspectors, in which event
the proxies and ballots shall be received, and all questions touching the
qualification of voters and the validity of proxies and the acceptance or
rejection of votes shall be decided, by such inspectors. Unless so demanded or
ordered, no vote need be by ballot and voting need not be conducted by
inspectors. The stockholders at any meeting may choose an inspector or
inspectors to act at such meeting, and in default of such election the chairman
of the meeting may appoint an inspector or inspectors. No candidate for
election as a director at a meeting shall serve as an inspector thereat.
SECTION 1.10. INFORMAL ACTION BY STOCKHOLDERS. Any action required or
permitted to be taken at a meeting of stockholders may be taken without a
meeting if there is filed with the records of stockholders meetings an unanimous
written consent which sets forth the action and is signed by each stockholder
entitled to vote on the matter and a written waiver of any right to dissent
signed by each stockholder entitled to notice of the meeting but not entitled to
vote at it.
SECTION 1.11. MEETING BY CONFERENCE TELEPHONE. Stockholders may
participate in a meeting by means of a conference telephone or similar
communications equipment if all persons participating in the meeting can hear
each other at the same time. Participation in a meeting by these means
constitutes presence in person at a meeting.
SECTION 1.12. PROPER BUSINESS FOR ANNUAL STOCKHOLDERS' MEETING.
Nominations for the election of directors and proposals for any new business to
be taken up at any annual meeting of stockholders may be made by the Board of
Directors of the Corporation or by any stockholder of the Corporation entitled
to vote generally in the election of directors. To be properly brought before
the annual meeting, business must be either (i) specified in the notice of
meeting (or any supplement thereto) given by or at the direction of the Board of
Directors, (ii) otherwise properly brought before the meeting by or at the
direction of the Board of Directors, or (iii) otherwise properly brought before
the meeting by a stockholder who is entitled to vote at the meeting. In
addition to any other applicable requirements contained in the Charter, these
By-Laws, or under law, for business to be properly brought before an annual
meeting by a stockholder, the stockholder must have given timely notice thereof
in writing to the Secretary of the Corporation. To be timely, a stockholder's
notice must be delivered to or mailed by first class United States mail, postage
prepaid, and received at the principal executive office of the Corporation not
less than 50 days nor more than 75 days prior to the annual meeting; provided,
however, that in the event that less than 65 days' notice or prior public
disclosure of the date of the meeting is given or made to stockholders,
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notice by the stockholder to be timely must be so received not later than the
close of business on the 10th day following the day on which such notice of the
date of the annual meeting was mailed or such public disclosure was made,
whichever first occurs. A stockholder's notice to the Secretary shall set forth
(i) one or more matters appropriate for stockholder action that the stockholder
proposes to bring before the meeting, (ii) a brief description of the matters
desired to be brought before the meeting and the reasons for conducting such
business at the meeting, (iii) the name and record address of the stockholder,
(iv) the class and number of shares of the Corporation that the stockholder owns
or is entitled to vote and (v) any material interest of the stockholder in such
matters. In addition, if such notice is given by a stockholder with respect to
nominations for the election of directors such notice shall also set forth (i)
the name, age, business address and, if known, residence address of each nominee
proposed in such notice, (ii) the principal occupation or employment of each
such nominee, (iii) the number of shares of stock of the Corporation which are
beneficially owned by each such nominee, (iv) such other information as would be
required to be included in a proxy statement soliciting proxies for the election
of the proposed nominee pursuant to Regulation 14A of the Securities Exchange
Act of 1934, as amended, including, without limitation, such person's written
consent to being named in the proxy statement as a nominee and to serving as a
director, if elected, and (v) as to the stockholder giving such notice, his name
and address as they appear on the Corporation's books and the class and number
of shares of the Corporation which are beneficially owned by such stockholder.
In addition, the stockholder making such nomination shall promptly provide any
other information reasonably requested by the Corporation. Notwithstanding
anything in these By-Laws to the contrary, no business shall be conducted at the
annual meeting except in accordance with the procedure set forth in this Section
1.12; provided, however, that nothing in this Section 1.12 shall be deemed to
preclude discussion by any stockholder of any business properly brought before
the annual meeting. The Chairman of the Board, or the President in the absence
of the Chairman of the Board, shall, if the facts warrant, determine and declare
to the meeting that the business was not properly brought before the meeting in
accordance with the provisions of this Section 1.12 and if the Chairman of the
Board, or the President in the absence of the Chairman of the Board, should so
determine, shall so declare to the meeting any such business not properly
brought before the meeting shall not be transacted.
SECTION 1.13. PROPER BUSINESS FOR SPECIAL STOCKHOLDERS' MEETING. Only
business specified in the notice of a special meeting (or any supplement
thereto) given by or at the direction of the Board of Directors may be brought
before such meeting. Nominations of persons for election to the Board of
Directors must be either (i) specified in the notice of meeting (or any
supplement thereto) given by or at the direction of the Board of Directors, (ii)
otherwise properly brought before a meeting by or at the direction of the Board
of Directors, or (iii) provided that the Board of Directors has determined that
directors shall be elected at the meeting, otherwise properly brought before the
meeting by a stockholder who is entitled to vote at the meeting. In addition to
any other applicable requirements contained in the Charter, these By-Laws, or
under law, for nominations to be properly brought before a special meeting by a
stockholder, the stockholder must gave given timely notice thereof in
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writing to the Secretary of the Corporation. To be timely, a stockholder's
notice must be delivered to or mailed by first class United States mail, postage
prepaid, and received at the principal executive office of the Corporation not
less than 50 days nor more than 75 days prior to the special meeting; provided,
however, that in the event that less than 65 days' notice or prior public
disclosure of the date of the meeting is given or made to stockholders, notice
by the stockholder to be timely must be so received not later than the close of
business on the 10th day following the day on which such notice of the date of
the special meeting was mailed or such public disclosure was made, whichever
first occurs. A stockholder's notice to the Secretary shall set forth all of the
information required and set forth in Section 1.12 above. Notwithstanding
anything in these By-Laws to the contrary, no business shall be conducted at the
special meeting except in accordance with the procedure set forth in this
Section 1.13. The Chairman of the Board, or the President in the absence of the
Chairman of the Board, shall, if the facts warrant, determine and declare to the
meeting that the business was not properly brought before the meeting in
accordance with the provisions of this Section 1.13 and if the Chairman of the
Board, or the President in the absence of the Chairman of the Board, should so
determine, shall so declare to the meeting any such business not properly
brought before the meeting shall not be transacted.
ARTICLE II.
BOARD OF DIRECTORS
SECTION 2.01. FUNCTION OF DIRECTORS. The business and affairs of the
Corporation shall be managed under the direction of its Board of Directors. All
powers of the Corporation may be exercised by or under authority of the Board of
Directors, except as conferred on or reserved to the stockholders by statute or
by the Charter or By-Laws.
SECTION 2.02. NUMBER OF DIRECTORS. The number of directors of the
Corporation shall not be fewer than the minimum required by Maryland law nor
more than nine. Within this range, the initial number shall be the number of
directors provided in the Charter until changed as herein provided. Unless
statute or the Charter provides otherwise, a majority of the entire Board of
Directors may alter the number of directors set by the Charter to not exceeding
25 nor less than the minimum number then permitted herein, but the action may
not affect the tenure of any director. At all times subsequent to the sale of
stock of the Corporation pursuant to a Registration Statement filed under the
Securities Act of 1933, as amended, a majority of the Board of Directors shall
be "Independent Directors" (as defined in the Charter).
SECTION 2.03. ELECTION AND TENURE OF DIRECTORS. Subject to the rights of
the holders of any class of stock separately entitled to elect one or more
directors, at such annual meeting, the stockholders shall elect directors to
hold office until the next annual meeting and until their successors are elected
and qualify.
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SECTION 2.04. VACANCY ON BOARD. Subject to the rights of the holders of
any class of stock separately entitled to elect one or more directors, the
stockholders may elect a successor to fill a vacancy on the Board of Directors
which results from the removal of a director. A director elected by the
stockholders to fill a vacancy which results from the removal of a director
serves for the balance of the term of the removed director. Subject to the
rights of the holders of any class of stock separately entitled to elect one or
more directors, a majority of the remaining directors, whether or not sufficient
to constitute a quorum, may fill a vacancy on the Board of Directors which
results from any cause except an increase in the number of directors, and a
majority of the entire Board of Directors may fill a vacancy which results from
an increase in the number of directors. A director elected by the Board of
Directors to fill a vacancy serves until the next annual meeting of stockholders
and until his or her successor is elected and qualifies. Notwithstanding any
provision of this Section 2.05, any vacancy on the Board of Directors among the
Independent Directors not filled by the stockholders shall be filled by a vote
of the majority of the Board or Directors (or the remaining directors if less
than a quorum) and shall require the vote of a majority of the remaining
Independent Directors.
SECTION 2.05. REGULAR MEETINGS. After each meeting of stockholders at
which directors shall have been elected, the Board of Directors shall meet as
soon as practicable for the purpose of organization and the transaction of other
business. In the event that no other time and place are specified by resolution
of the Board, the President or the Chairman, with notice in accordance with
Section 2.08, the Board of Directors shall meet immediately following the close
of, and at the place of, such stockholders' meeting. Any other regular meeting
of the Board of Directors shall be held on such date and at any place as may be
designated from time to time by the Board of Directors.
SECTION 2.06. SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called at any time by the Chairman of the Board or the
President or by a majority of the Board of Directors by vote at a meeting, or in
writing with or without a meeting. A special meeting of the Board of Directors
shall be held on such date and at any place as may be designated from time to
time by the Board of Directors. In the absence of designation such meeting
shall be held at such place as may be designated in the call.
SECTION 2.07. NOTICE OF MEETING. Except as provided in Section 2.06, the
Secretary shall give notice to each director of each regular and special meeting
of the Board of Directors. The notice shall state the time and place of the
meeting. Notice is given to a director when it is delivered personally to him
or her, left at his or her residence or usual place of business, or sent by
telegraph, facsimile transmission or telephone, at least 24 hours before the
time of the meeting or, in the alternative by mail to his or her address as it
shall appear on the records of the Corporation, at least 72 hours before the
time of the meeting. Unless these By-Laws or a resolution of the Board of
Directors provides otherwise, the notice need not state the business to be
transacted at or the purposes of any regular or special meeting of the Board of
Directors. No notice of any meeting of the Board of Directors need be given to
any director who attends except where a director attends a meeting for the
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express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened, or to any director who, in writing
executed and filed with the records of the meeting either before or after the
holding thereof, waives such notice. Any meeting of the Board of Directors,
regular or special, may adjourn from time to time to reconvene at the same time
or some other place, and no notice need be given of any such adjourned meeting
other than by announcement.
SECTION 2.08. QUORUM; ACTION BY DIRECTORS. A majority of the entire Board
of Directors shall constitute a quorum for the transaction of business. In the
absence of a quorum, the directors present by majority vote and without notice
other than by announcement may adjourn the meeting from time to time until a
quorum shall attend. At any such adjourned meeting at which a quorum shall be
present, any business may be transacted which might have been transacted at the
meeting as originally notified. Unless statute or the Charter or By-Laws
requires a greater proportion, the action of a majority of the directors present
at a meeting at which a quorum is present is action of the Board of Directors.
Any action required or permitted to be taken at a meeting of the Board of
Directors may be taken without a meeting, if an unanimous written consent which
sets forth the action is signed by each member of the Board and filed with the
minutes of proceedings of the Board.
SECTION 2.09. MEETING BY CONFERENCE TELEPHONE. Members of the Board of
Directors may participate in a meeting by means of a conference telephone or
similar communications equipment if all persons participating in the meeting can
hear each other at the same time. Participation in a meeting by these means
constitutes presence in person at a meeting.
SECTION 2.10. COMPENSATION. Members of the Board of Directors who are
Independent Directors shall each receive $12,000 annually as compensation for
their services as such or on committees of the Board of Directors. If more than
four meetings of the Board of Directors or committee thereof are held in a given
year, then each Independent Director shall receive $1,000 for attending each
such additional meeting in person and $100 per hour for attending each such
meeting telephonically. Each Independent Director shall be reimbursed for costs
and expenses incurred by such Independent Director in attending any meeting of
the Board of Directors. Members of the Board of Directors who are not
Independent Directors shall not receive additional compensation for their
services as such or on committees of the Board of Directors.
SECTION 2.11. INVESTMENT POLICIES AND RESTRICTIONS. The investment
policies of the Corporation and the restrictions thereon shall be established
from time to time by the Board of Directors, including a majority of the
Independent Directors; provided, however, that the investment policies of the
Corporation and the limitations thereon shall be at all times in compliance with
the restrictions applicable to real estate investment trusts pursuant to the
Internal Revenue Code of 1986, as it may be amended from time to time. The
Independent Directors shall review the investment policies of the Corporation at
least
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annually to determine that the policies then being followed by the Corporation
are in the best interests of its stockholders. Each such determination and the
basis therefor shall be set forth in the minutes of the Board of Directors.
Subject to the provisions of the Charter and the Bylaws, the Board of Directors,
including a majority of the Independent Directors, may amend, revise or
terminate any policy or policies as it shall deem appropriate in its sole
discretion.
SECTION 2.12. MANAGEMENT AGREEMENTS. To the extent permitted by
applicable law and subject to such conditions, if any, as may be required by
applicable law or other applicable rule or regulation, the Board of Directors
may engage a manager to advise the Board of Directors and be responsible for
directing the day-to-day business affairs of the Corporation ("Manager")
pursuant to a written agreement or agreements ("Management Agreement"). The
approval of any such Management Agreement and the renewal or termination thereof
shall require the affirmative vote of the majority of the Independent Directors.
The Board of Directors shall evaluate the performance of the Manager before
entering into or renewing any Management Agreement. The minutes of the meetings
with respect to such evaluation shall reflect the criteria used by the Board of
Directors in making such evaluation. Upon any termination of the Management
Agreement described in the initial registration statement of this Corporation's
initial public offering of securities, the Board of Directors shall determine
that any successor Manager possesses sufficient qualifications (a) to perform
the management function for the Corporation and (b) to justify the compensation
provided for in its contract with the Corporation. Each extension of the
contract for the services of a Manager entered into by the Board of Directors
shall have a term of no more than two years.
In determining whether to enter into or renew any Management Agreement, the
Independent Directors shall consider the following factors and all other factors
that they may deem relevant and their findings on each of such factors shall be
recorded in the minutes of the Board of Directors:
(a) The size of management fee in relation to the size and profitability of
the investment portfolio of the Corporation;
(b) The success of the Manager in generating opportunities that meet the
investment objectives of the Corporation;
(c) The quality and extent of service and advice furnished by the Manager
to the Corporation;
(d) The rates charged to other corporations similar to the Corporation and
to other investors by advisers performing similar services; and
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(e) Additional revenues realized by the Manager and its Affiliates through
their relationship with the Corporation, including loan administration,
underwriting or broker commissions, servicing, engineering, inspection and other
fees, whether paid by the Corporation or by others with whom the Corporation
does business.
SECTION 2.13. RELATED PARTY TRANSACTIONS. In addition to any other
requirements imposed by the Charter, these By-Laws or applicable law, a majority
of the Independent Directors shall approve general guidelines ("Guidelines") for
the Corporation's investments, borrowings and operations, and the Independent
Directors shall conduct a quarterly review of all transactions with WFSG or any
Affiliate of WFSG, in advance, to insure compliance with the Guidelines. "WFSG"
shall mean Wilshire Financial Services Group Inc., a Delaware corporation.
SECTION 2.14. MANAGEMENT BY DIRECTORS. To the extent permitted by
applicable law and subject to such conditions, if any, as may be required by
applicable law or other applicable rule or regulation, the Board of Directors
may elect to engage a Manager to advise the Board of Directors and be
responsible for directing the day-to-day business affairs of the Corporation;
provided that if management is delegated to a Manager the directors shall devote
so much of their time to the Corporation's affairs as is necessary or required
for the effective conduct and operation of the Corporation's business.
ARTICLE III.
COMMITTEES
SECTION 3.01. COMMITTEES. The Board of Directors may appoint from among
its members an Executive Committee, an Audit Committee, a Compensation
Committee, and other committees composed of one or more directors and delegate
to these committees any of the powers of the Board of Directors, except the
power to declare dividends or distributions on stock, elect directors, issue
stock other than as provided in the next sentence, recommend to the stockholders
any action which requires stockholder approval, amend these By-Laws, or approve
any merger or share exchange which does not require stockholder approval. If
the Board of Directors has given general authorization for the issuance of stock
providing for or establishing a method or procedure for determining the maximum
number of shares to be issued, a committee of the Board, in accordance with that
general authorization or any stock option or other plan or program adopted by
the Board of Directors, may authorize or fix the terms of stock subject to
classification or reclassification and the terms on which any stock may be
issued, including all terms and conditions required or permitted to be
established or authorized by the Board of Directors.
SECTION 3.02. COMMITTEE PROCEDURE. Each committee may fix rules of
procedure for its business. A majority of the members of a committee shall
constitute a quorum for the transaction of business and the act of a majority of
those present at a meeting at which a
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quorum is present shall be the act of the committee. The members of a committee
present at any meeting, whether or not they constitute a quorum, may appoint a
director to act in the place of an absent member. Any action required or
permitted to be taken at a meeting of a committee may be taken without a
meeting, if an unanimous written consent which sets forth the action is signed
by each member of the committee and filed with the minutes of the committee. The
members of a committee may conduct any meeting thereof by conference telephone
in accordance with the provisions of Section 2.10.
SECTION 3.03. EMERGENCY. In the event of a state of disaster of
sufficient severity to prevent the conduct and management of the affairs and
business of the Corporation by its directors and officers as contemplated by the
Charter and these By-Laws, any two or more available members of the then
incumbent Executive Committee shall constitute a quorum of that Committee for
the full conduct and management of the affairs and business of the Corporation
in accordance with the provisions of Section 3.01. In the event of the
unavailability, at such time, of a minimum of two members of the then incumbent
Executive Committee, the available directors shall elect an Executive Committee
consisting of any two members of the Board of Directors, whether or not they be
officers of the Corporation, which two members shall constitute the Executive
Committee for the full conduct and management of the affairs of the Corporation
in accordance with the foregoing provisions of this Section. This Section shall
be subject to implementation by resolution of the Board of Directors passed from
time to time for that purpose, and any provisions of these By-Laws (other than
this Section) and any resolutions which are contrary to the provisions of this
Section or to the provisions of any such implementary resolutions shall be
suspended until it shall be determined by any interim Executive Committee acting
under this Section that it shall be to the advantage of the Corporation to
resume the conduct and management of its affairs and business under all the
other provisions of these By-Laws.
SECTION 3.04. AUDIT COMMITTEE. The principal functions of the Audit
Committee, if one shall be formed, shall include making recommendations to the
Board of Directors regarding the annual selection of independent public
accountants, reviewing the proposed scope of each annual audit and reviewing the
recommendations of the independent public accountants as a result of their audit
of the Corporation's financial Statements. In general, the Audit Committee
shall perform such duties as are customarily performed by an audit committee of
a corporation and shall perform such other duties and have such other powers as
are from time to time assigned to it by the Board of Directors.
SECTION 3.05. COMPENSATION COMMITTEE. The principal functions of the
Compensation Committee, if one shall be formed, shall include establishing the
compensation of officers of the Corporation and establishing and administering
the Corporation's compensation programs. In general, the Compensation Committee
shall perform such duties as are customarily performed by a compensation
committee of a corporation and shall perform such other duties and have such
other powers as are from time to time assigned to it by the Board of Directors.
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ARTICLE IV.
OFFICERS
SECTION 4.01. EXECUTIVE AND OTHER OFFICERS. The Corporation shall have a
President, a Secretary, and a Treasurer. It may also have a Chairman of the
Board. The Board of Directors shall designate who shall serve as chief
executive officer, who shall have general supervision of the business and
affairs of the Corporation, and may designate a chief operating officer, who
shall have supervision of the operations of the Corporation. In the absence of
any designation the Chairman of the Board, if there be one, shall serve as chief
executive officer and the President shall serve as chief operating officer. In
the absence of the Chairman of the Board, or if there be none, the President
shall be the chief executive officer. The same person may hold both offices.
The Corporation may also have one or more Vice-Presidents, assistant officers,
and subordinate officers as may be established by the Board of Directors. A
person may hold more than one office in the Corporation except that no person
may serve concurrently as both President and Vice-President of the Corporation.
The Chairman of the Board shall be a director, and the other officers may be
directors.
SECTION 4.02. CHAIRMAN OF THE BOARD. The Chairman of the Board, if one be
elected, shall preside at all meetings of the Board of Directors and of the
stockholders at which he or she shall be present. Unless otherwise specified by
the Board of Directors, he or she shall be the chief executive officer of the
Corporation. In general, he or she shall perform such duties as are customarily
performed by the chief executive officer of a corporation and may perform any
duties of the President and shall perform such other duties and have such other
powers as are from time to time assigned to him or her by the Board of
Directors.
SECTION 4.03. PRESIDENT. Unless otherwise provided by resolution of the
Board of Directors, the President, in the absence of the Chairman of the Board,
shall preside at all meetings of the Board of Directors and of the stockholders
at which he or she shall be present. Unless otherwise specified by the Board of
Directors, the President shall be the chief operating officer of the Corporation
and perform the duties customarily performed by chief operating officers. He or
she may execute, in the name of the Corporation, all authorized deeds,
mortgages, bonds, contracts or other instruments, except in cases in which the
signing and execution thereof shall have been expressly delegated to some other
officer or agent of the Corporation. In general, he or she shall perform such
other duties customarily performed by a president of a corporation and shall
perform such other duties and have such other powers as are from time to time
assigned to him or her by the Board of Directors or the chief executive officer
of the Corporation.
SECTION 4.04. VICE-PRESIDENTS. The Vice-President or Vice-Presidents, at
the request of the chief executive officer or the President, or in the
President's absence or during his or her inability to act, shall perform the
duties and exercise the functions of the
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President, and when so acting shall have the powers of the President. If there
be more than one Vice-President, the Board of Directors may determine which one
or more of the Vice-Presidents shall perform any of such duties or exercise any
of such functions, or if such determination is not made by the Board of
Directors, the chief executive officer, or the President may make such
determination; otherwise any of the Vice-Presidents may perform any of such
duties or exercise any of such functions. Each Vice-President shall perform such
other duties and have such other powers, and have such additional descriptive
designations in their titles (if any), as are from time to time assigned to them
by the Board of Directors, the chief executive officer, or the President.
SECTION 4.05. SECRETARY. The Secretary shall keep the minutes of the
meetings of the stockholders, of the Board of Directors and of any committees,
in books provided for the purpose; he or she shall see that all notices are duly
given in accordance with the provisions of these By-Laws or as required by law;
he or she shall be custodian of the records of the Corporation; he or she may
witness any document on behalf of the Corporation, the execution of which is
duly authorized, see that the corporate seal is affixed where such document is
required or desired to be under its seal, and, when so affixed, may attest the
same. In general, he or she shall perform such other duties customarily
performed by a secretary of a corporation, and shall perform such other duties
and have such other powers as are from time to time assigned to him or her by
the Board of Directors, the chief executive officer, or the President.
SECTION 4.06. TREASURER. The Treasurer shall have charge of and be
responsible for all funds, securities, receipts and disbursements of the
Corporation, and shall deposit, or cause to be deposited, in the name of the
Corporation, all moneys or other valuable effects in such banks, trust companies
or other depositories as shall, from time to time, be selected by the Board of
Directors; he or she shall render to the President and to the Board of
Directors, whenever requested, an account of the financial condition of the
Corporation. In general, he or she shall perform such other duties customarily
performed by a treasurer of a corporation, and shall perform such other duties
and have such other powers as are from time to time assigned to him or her by
the Board of Directors, the chief executive officer, or the President.
SECTION 4.07. ASSISTANT AND SUBORDINATE OFFICERS. The assistant and
subordinate officers of the Corporation are all officers below the office of
Vice-President, Secretary, or Treasurer. The assistant or subordinate officers
shall have such duties as are from time to time assigned to them by the board of
Directors, the chief executive officer, or the President.
SECTION 4.08. ELECTION, TENURE AND REMOVAL OF OFFICERS. The Board of
Directors shall elect the officers of the Corporation. The Board of Directors
may from time to time authorize any committee or officer to appoint assistant
and subordinate officers. Election or appointment of an officer, employee or
agent shall not of itself create contractual rights. All officers shall be
appointed to hold their offices, respectively, during the pleasure of the Board.
The Board of Directors (or, as to any assistant or subordinate officer, any
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committee or officer authorized by the Board) may remove an officer at any time.
The removal of an officer does not prejudice any of his or her contract rights.
The Board of Directors (or, as to any assistant or subordinate officer, any
committee or officer authorized by the Board) may fill a vacancy which occurs in
any office of the unexpired portion of the term.
SECTION 4.09. COMPENSATION. The Board of Directors shall have power to
fix the salaries and other compensation and remuneration, of whatever kind, of
all officers of the Corporation. No officer shall be prevented from receiving
such salary by reason of the fact that he or she is also a director of the
Corporation. The Board of Directors may authorize any committee or officer,
upon whom the power of appointing assistant and subordinate officers may have
been conferred, to fix the salaries, compensation and remuneration of such
assistant and subordinate officers.
ARTICLE V.
DIVISIONAL TITLES
SECTION 5.01. CONFERRING DIVISIONAL TITLES. The Board of Directors may
from time to time confer upon any employee of a division of the Corporation the
title of President, Vice President, Treasurer or Controller of such division or
any other title or titles deemed appropriate, or may authorize the Chairman of
the Board or the President to do so. Any such titles so conferred may be
discontinued and withdrawn at any time by the Board of Directors, or by the
Chairman of the Board or the President if so authorized by the Board of
Directors. Any employee of a division designated by such a divisional title
shall have the powers and duties with respect to such division as shall be
prescribed by the Board of Directors, the Chairman of the Board or the
President.
SECTION 5.02. EFFECT OF DIVISIONAL TITLES. The conferring of divisional
titles shall not create an office of the Corporation under Article IV unless
specifically designated as such by the Board of Directors; but any person who is
an officer of the Corporation may also have a divisional title.
ARTICLE VI.
STOCK
SECTION 6.01. CERTIFICATES FOR STOCK. The Board of Directors may
determine to issue certificated or uncertificated shares of capital stock and
other securities of the Corporation. For certificated stock, each stockholder
is entitled to certificates which represent and certify the shares of stock he
or she holds in the Corporation. Each stock certificate shall include on its
face the name of the Corporation, the name of the stockholder
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or other person to whom it is issued, and the class of stock and number of
shares it represents. It shall also include on its face or back (a) a statement
of any restrictions on transferability and (b) a statement which provides in
substance that the Corporation will furnish to any stockholder on request and
without charge a full statement of the designations and any preferences,
conversion and other rights, voting powers, restrictions, limitations as to
dividends, qualifications, and terms and conditions of redemption of the stock
of each class which the Corporation is authorized to issue, of the differences
in the relative rights and preferences between the shares of each series of a
preferred or special class in series which the Corporation is authorized to
issue, to the extent they have been set, and of the authority of the Board of
Directors to set the relative rights and preferences of subsequent series of a
preferred or special class of stock and any restrictions on transferability.
Such request may be made to the Secretary or to its transfer agent. Upon the
issuance of uncertificated shares of capital stock, the Corporation shall send
the stockholder a written statement of the same information required above on
the certificate and by the Maryland Uniform Commercial Code - Investment
Securities. It shall be in such form, not inconsistent with law or with the
Charter, as shall be approved by the Board of Directors or any officer or
officers designated for such purpose by resolution of the Board of Directors.
Each stock certificate shall be signed by the Chairman of the Board, the
President, or a Vice-President, and countersigned by the Secretary, an Assistant
Secretary, the Treasurer, or an Assistant Treasurer. Each certificate may be
sealed with the actual corporate seal or a facsimile of it or in any other form
and the signatures may be either manual or facsimile signatures. A certificate
is valid and may be issued whether or not an officer who signed it is still an
officer when it is issued. A certificate may not be issued until the stock
represented by it is fully paid.
SECTION 6.02. TRANSFERS. The Board of Directors shall have power and
authority to make such rules and regulations as it may deem expedient concerning
the issue, transfer and registration of certificates of stock; and may appoint
transfer agents and registrars thereof. The duties of transfer agent and
registrar may be combined.
SECTION 6.03. RECORD DATES OR CLOSING OF TRANSFER BOOKS. The Board of
Directors may set a record date or direct that the stock transfer books be
closed for a stated period for the purpose of making any proper determination
with respect to stockholders, including which stockholders are entitled to
notice of a meeting, vote at a meeting, receive a dividend, or be allotted other
rights. The record date may not be prior to the close of business on the day
the record date is fixed nor, subject to Section 1.06, more than 90 days before
the date on which the action requiring the determination will be taken; the
transfer books may not be closed for a period longer than 20 days; and, in the
case of a meeting of stockholders, the record date or the closing of the
transfer books shall be at least ten days before the date of the meeting.
SECTION 6.04. STOCK LEDGER. The Corporation shall maintain a stock ledger
which contains the name and address of each stockholder and the number of shares
of stock of each class which the stockholder holds. The stock ledger may be in
written form or in any other form which can be converted within a reasonable
time into written form for visual
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inspection. The original or a duplicate of the stock ledger shall be kept at the
offices of a transfer agent for the particular class of stock, or, if none, at
the principal office in the State of Maryland or the principal executive offices
of the Corporation.
SECTION 6.05. CERTIFICATION OF BENEFICIAL OWNERS. The Board of Directors
may adopt by resolution a procedure by which a stockholder of the Corporation
may certify in writing to the Corporation that any shares of stock registered in
the name of the stockholder are held for the account of a specified person other
than the stockholder. The resolution shall set forth the class of stockholders
who may certify; the purpose for which the certification may be made; the form
of certification and the information to be contained in it; if the certification
is with respect to a record date or closing of the stock transfer books, the
time after the record date or closing of the stock transfer books within which
the certification must be received by the Corporation; and any other provisions
with respect to the procedure which the Board considers necessary or desirable.
On receipt of a certification which complies with the procedure adopted by the
Board in accordance with this Section, the person specified in the certification
is, for the purpose set forth in the certification, the holder of record of the
specified stock in place of the stockholder who makes the certification.
SECTION 6.06. LOST STOCK CERTIFICATES. The Board of Directors of the
Corporation may determine the conditions for issuing a new stock certificate in
place of one which is alleged to have been lost, stolen, or destroyed, or the
Board of Directors may delegate such power to any officer or officers of the
Corporation. In their discretion, the Board of Directors or such officer or
officers may require the owner of the certificate to give bond, with sufficient
surety, to indemnify the Corporation against any loss or claim arising as a
result of the issuance of a new certificate. In their discretion, the Board of
Directors or such officer or officers may refuse to issue such new certificate
save upon the order of some court having jurisdiction in the premises.
SECTION 6.07. EXEMPTION FROM CONTROL SHARE ACQUISITION STATUTE. The
provisions of Sections 3-701 to 3-709 of the Corporations and Associations
Article of the Annotated Code of Maryland shall not apply to any share of the
capital stock of the Corporation. Such shares of capital stock are exempted
from such Sections to the fullest extent permitted by Maryland law.
ARTICLE VII.
FINANCE
SECTION 7.01. CHECKS, DRAFTS, ETC. All checks, drafts and orders for the
payment of money, notes and other evidences of indebtedness, issued in the name
of the Corporation, shall, unless otherwise provided by resolution of the Board
of Directors, be signed by the Chairman of the Board, the President, a Vice-
President or an Assistant Vice-President and
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countersigned by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary.
SECTION 7.02. ANNUAL STATEMENT OF AFFAIRS. The President or chief
accounting officer shall prepare annually a full and correct statement of the
affairs of the Corporation, to include a balance sheet and a financial statement
of operations for the preceding fiscal year. The statement of affairs shall be
submitted at the annual meeting of the stockholders and, within 20 days after
the meeting, placed on file at the Corporation's principal office.
SECTION 7.03. FISCAL YEAR. The fiscal year of the Corporation shall be
the 12 calendar months period ending December 31st in each year, unless
otherwise provided by the Board of Directors.
SECTION 7.04. DIVIDENDS. If declared by the Board of Directors at any
meeting thereof, the Corporation may pay dividends on its shares in cash,
property, or in shares of the capital stock of the Corporation, unless such
dividend is contrary to law or to a restriction contained in the Charter.
ARTICLE VIII.
INDEMNIFICATION
SECTION 8.01. PROCEDURE. Any indemnification, or payment of expenses in
advance of the final disposition of any proceeding, shall be made promptly, and
in any event within 60 days, upon the written request of the director or officer
entitled to seek indemnification (the "Indemnified Party"). The right to
indemnification and advances hereunder shall be enforceable by the Indemnified
Party in any court of competent jurisdiction, if (i) the Corporation denies such
request, in whole or in part, or (ii) no disposition thereof is made within 60
days. The Indemnified Party's costs and expenses incurred in connection with
successfully establishing his or her right to indemnification, in whole or in
part, in any such action shall also be reimbursed by the Corporation. It shall
be a defense to any action for advance of expenses that (a) a determination has
been made that the facts then known to those making the determination would
preclude indemnification or (b) the Corporation has not received both (i) an
undertaking as required by law to repay such advances in the event it shall
ultimately be determined that the standard of conduct has not been met and (ii)
a written affirmation by the Indemnified Party of such Indemnified Party's good
faith belief that the standard of conduct necessary for indemnification by the
Corporation has been met.
SECTION 8.02. EXCLUSIVITY, ETC. The indemnification and advance of
expenses provided by the Charter and these By-Laws shall not be deemed exclusive
of any other rights to which a person seeking indemnification or advance of
expenses may be entitled under any law (common or statutory), or any agreement,
vote of stockholders or disinterested directors
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or other provision that is consistent with law, both as to action in his or her
official capacity and as to action in another capacity while holding office or
while employed by or acting as agent for the Corporation, shall continue in
respect of all events occurring while a person was a director or officer after
such person has ceased to be a director or officer, and shall inure to the
benefit of the estate, heirs, executors and administrators of such person. The
Corporation shall not be liable for any payment under this By-Law in connection
with a claim made by a director or officer to the extent such director or
officer has otherwise actually received payment under insurance policy,
agreement, vote or otherwise, of the amounts otherwise indemnifiable hereunder.
All rights to indemnification and advance of expenses under the Charter of the
Corporation and hereunder shall be deemed to be a contract between the
Corporation and each director or officer of the Corporation who serves or served
in such capacity at any time while this By-Law is in effect. Nothing herein
shall prevent the amendment of this By-Law, provided that no such amendment
shall diminish the rights of any person hereunder with respect to events
occurring or claims made before its adoption or as to claims made after its
adoption in respect of events occurring before its adoption. Any repeal or
modification of this By-Law shall not in any way diminish any rights to
indemnification or advance of expenses of such director or officer or the
obligations of the Corporation arising hereunder with respect to events
occurring, or claims made, while this By-Law or any provision hereof is in
force.
SECTION 8.03. SEVERABILITY; DEFINITIONS. The invalidity or
unenforceability of any provision of this Article VIII shall not affect the
validity or enforceability of any other provision hereof. The phrase "this By-
Law" in this Article VIII means this Article VIII in its entirety.
ARTICLE IX.
SUNDRY PROVISIONS
SECTION 9.01. BOOKS AND RECORDS. The Corporation shall keep correct and
complete books and records of its accounts and transactions and minutes of the
proceedings of its stockholders and Board of Directors and of any executive or
other committee when exercising any of the powers of the Board of Directors.
The books and records of the Corporation may be in written form or in any other
form which can be converted within a reasonable time into written form for
visual inspection. Minutes shall be recorded in written form but may be
maintained in the form of a reproduction. The original or certified copy of
these By-Laws shall be kept at the principal office of the Corporation.
SECTION 9.02. CORPORATE SEAL. The Board of Directors shall provide a
suitable seal, bearing the name of the Corporation, which shall be in the charge
of the Secretary. The Board of Directors may authorize one or more duplicate
seals and provide for the custody thereof. If the Corporation is required to
place its corporate seal to a document, it is sufficient to meet the requirement
of any law, rule, or regulation relating to a corporate seal
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to place the word "(seal)" adjacent to the signature of the person authorized to
sign the document on behalf of the Corporation.
SECTION 9.03. BONDS. The Board of Directors may require any officer,
agent or employee of the Corporation to give a bond to the Corporation,
conditioned upon the faithful discharge of his or her duties, with one or more
sureties and in such amount as may be satisfactory to the Board of Directors.
SECTION 9.04. VOTING STOCK IN OTHER CORPORATIONS. Stock of other
corporations or associations, registered in the name of the Corporation, may be
voted by the President, a Vice-President, or a proxy appointed by either of
them. The Board of Directors, however, may by resolution appoint some other
person to vote such shares, in which case such person shall be entitled to vote
such shares upon the production of a certified copy of such resolution.
SECTION 9.05. MAIL. Any notice or other document which is required by
these By-Laws to be mailed shall be deposited in the United States mails,
postage prepaid.
SECTION 9.06. EXECUTION OF DOCUMENTS. A person who holds more than one
office in the Corporation may not act in more than one capacity to execute,
acknowledge, or verify an instrument required by law to be executed,
acknowledged, or verified by more than one officer.
SECTION 9.07. AMENDMENTS. These By-Laws may be repealed, altered, amended
or rescinded (a) by the stockholders of the Corporation (voting together for
this purpose as a single class) by the affirmative vote of not less than two-
thirds (2/3) of all the votes entitled to be cast by the outstanding shares of
capital stock of the Corporation generally in the election of directors which
are cast on the matter at any meeting of the stockholders called for that
purpose (provided that notice of such proposed repeal, alteration, amendment or
rescission is included in the notice of such meeting) or (b) by affirmative vote
of not less than a majority of the Board of Directors (including a majority of
the Independent Directors) at a meeting held in accordance with the provisions
of these By-Laws.
SECTION 9.08. CERTAIN RIGHTS OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS.
The directors shall have no responsibility to devote their full time to the
affairs of the Corporation. Any director or officer, employee or agent of the
Corporation, in his or her personal capacity or in a capacity as an affiliate,
employee, or agent of any other person, or otherwise, may have business
interests and engage in business activities similar to or in addition to those
of or relating to the Corporation.
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